Foreign media report that in the Panama port transaction, 'China has raised requirements, mandating Chinese enterprises to hold majority stakes.' How should we view the progress of this transaction?

The Panama Canal lies at the heart of the triangular relationship among China, Panama, and the United States. This approximately 80-kilometer-long waterway handles about 5% of global maritime trade volume. Constructed with U.S. funding, the Canal was operated by the United States from 1914 to 1999 before being transferred to Panama. For at least the past decade, the United States and China have been the Canal’s two largest users. Over recent months, Donald Trump has repeatedly threatened to reassert U.S. control over the strategically vital Panama Canal, claiming it is 'under Chinese influence'—citing CK Hutchison Holdings’ (CKHH) concession-based operation of the Cristóbal (Atlantic-side) and Balboa (Pacific-side) ports at both ends of the Canal. Under this pressure, CKHH has agreed to sell its leasehold operating rights for these two port terminals to a consortium led by the U.S.-based investment firm BlackRock. However, Chinese stakeholders have expressed reservations about this deal. Hong Kong’s Ta Kung Pao published an article accusing CKHH of undermining China’s interests, questioning Li Ka-shing: 'How can such critically important ports be so easily transferred to unscrupulous U.S. forces?' It accused him of 'dancing with the United States' and warned he would 'be condemned by history,' intensifying public pressure. Mainland official media have widely republished sharp editorials criticizing CKHH’s decision to sell these two ports. On March 15, major media outlets again disseminated an editorial titled 'Great Entrepreneurs Are Always Outstanding Patriots,' further criticizing CKHH: 'If entrepreneurs fail to see through the true nature of U.S. politicians and choose to dance with them, they may close a lucrative deal and reap short-term wealth—but in the long run, they will forfeit their future and be condemned by history.' While media pressure mounts on CKHH, China’s state-owned enterprise COSCO Shipping Group has joined a global consortium bidding to acquire Li Ka-shing’s overseas port assets—and demanded veto power or equal authority within the entity taking over the ports. COSCO stated such rights are essential to prevent any decisions potentially harming China’s interests. Meanwhile, COSCO Shipping Ports Limited and Orient Overseas Container Line (OOCL) are closely monitoring the upcoming public tender for two new port facilities in Panama. Panama aims to attract $8.5 billion in investment over the next decade to expand port capacity, build natural gas pipelines, and construct new artificial lakes, among other projects. The Panama Canal Authority plans to award the concessions by the end of 2026, enabling the two new ports to commence operations in 2029. PSA International (Singapore), Evergreen Marine (Taiwan, China), Hapag-Lloyd (Germany), Maersk (Denmark), and CMA Terminals (France) have also expressed strong interest in these two new ports. IV. Panama’s Comptroller General declared CKHH’s port operation contract unconstitutional and filed litigation challenging the validity of its renewal. How will geopolitical rivalry shape the final outcome of the Panama Canal’s lease rights?

What is the latest development regarding the sale of the two ports along the Panama Canal?

On January 30, Panama’s Supreme Court issued a ruling declaring that the Panamanian government under President Laurentino Cortizo violated procedures when renewing CK Hutchison Holdings’ (CKHH) port operation concession in 2021—specifically, by failing to collect adequate concession fees. This violation contravened Panama’s Constitution, rendering the contract null and void. The two implicated ports will now be temporarily operated by a company under Denmark’s Maersk Group pending a new tender process—adding fresh uncertainty to a port dispute that has persisted for over a year. The famed canal in Panama—the critical maritime link between the Pacific and Atlantic Oceans—handles roughly 4% of global seaborne cargo volume, a fact widely known. Some therefore mistakenly assume the legal dispute concerns the Canal itself. In reality, this is a misconception. Panama’s Constitution stipulates that the Canal is national property, and may neither be sold, transferred, nor mortgaged. It can only be operated and maintained by the government agency—the Panama Canal Authority—and toll revenues from transiting vessels go exclusively to this authority. What is actually embroiled in controversy are the two massive container terminals located at either end of the Canal. If you’re unfamiliar with the shipping industry, you might assume the Canal’s value lies solely in offering a 'shortcut.' Yet this notion applies mainly to naval vessels. For massive container ships, the fuel savings from taking the shortcut are negligible. What ship operators truly care about is this: since transiting the Canal takes at least 10–12 hours, can they simultaneously load and unload containers at nearby ports while waiting in line? And if those ports feature free-trade zones, plus integrated rail and road networks connecting regional cargo flows, the overall cost-efficiency becomes significantly higher. That is precisely Panama’s model. Beyond the Canal itself, the country operates five ports and maintains a freight railway running parallel to the Canal—offering highly developed supporting infrastructure. The operators of these five ports are remarkably diverse: including Evergreen Marine (Taiwan, China), PSA International (Singapore), and U.S.-joint ventures. CK Hutchison Holdings—Li Ka-shing’s Hong Kong-based conglomerate, commonly known as 'CKHH'—secured 25-year concession rights in 1997 for the two largest ports at either end of the Canal, through its subsidiary. Note: In 1997, Panama had not yet established diplomatic relations with the People’s Republic of China—this was purely a commercial transaction. CKHH’s first contract expired in 2022; negotiations for renewal began one year earlier, and Panamanian authorities granted CKHH a second 25-year concession. Panama earned transit tolls ('road tolls') from the Canal, while international capital profited from port operations—a mutually beneficial arrangement. However, the 2024 U.S. presidential election changed everything. Trump first claimed Panama was 'extorting' U.S. vessels via Canal tolls, then escalated rhetoric alleging 'Chinese soldiers are operating the Canal' and that CKHH’s digitally automated cranes at the ports possess 'intelligence-gathering functions.' He even suggested the U.S. was considering 'reclaiming' the Panama Canal. Under such threats, Panamanian President José Raúl Mulino first announced Panama’s withdrawal from the Belt and Road Initiative, then launched a judicial investigation into CKHH’s two ports. In response, CKHH contacted a U.S.-European consortium in March 2025 to sell the operating rights to its 43 overseas ports—including the two in Panama—as a bundled package.

Panama Canal to Name Shortlisted Bidders for Terminal Project by Year-End

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The Panama Canal Authority expects to announce pre-qualified bidders for a new container terminal by year-end. The project is part of an $8.5 billion expansion plan including an LPG pipeline to boost logistics and energy capacity.

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